Kim Kardashian Fined $1,260,600 By SEC Over Cryptocurrency Posts

Kim Kardashian is in trouble with federal officials as a result of her cryptocurrency misadventure.

The Securities and Exchange Commission stated on Monday morning that the famous reality TV personality and influencer had settled accusations that she had concealed a payment for promoting a cryptocurrency on her Instagram feed.

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The SEC released this order against Kardashian on Monday morning

“This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn’t mean that those investment products are right for all investors,” Gary Gensler, chairman of the SEC, said in a news release.

Kardashian, whose estimated net worth is $1.8 billion, agreed to pay $1.26 million to resolve the allegations regarding the promotion of EthereumMax's cryptocurrency asset on Meta's Instagram, the SEC stated. The regulator stated that she has promised to abstain from promoting cryptocurrency securities for three years and would assist with an ongoing investigation.

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Kardashian, who has amassed a media and lifestyle empire, didn't agree or disagree with the regulator's conclusions, the SEC claimed.

Kardashian's attorney released a statement in which she expressed her satisfaction with the decision.

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“Kardashian fully cooperated with the SEC from the very beginning and she remains willing to do whatever she can to assist the SEC in this matter. She wanted to get this matter behind her to avoid a protracted dispute. The agreement she reached with the SEC allows her to do that so that she can move forward with her many different business pursuits,” the statement said.

A regulatory reaction against Kardashian's EthereumMax promotion, which she shared on Instagram in June of last year, has already begun. She posed the following question to her massive following: “ARE YOU INTO CRYPTO??? THIS IS NOT FINANCIAL ADVICE BUT SHARING WHAT MY FRIENDS JUST TOLD ME ABOUT THE ETHEREUM MAX TOKEN.”

Investors filed a lawsuit against her, former NBA player Paul Pierce, and renowned boxer Floyd Mayweather Jr. earlier this year over their advertisements for EthereumMax, alleging that they had raised the asset's value excessively.

On Monday, the SEC claimed that Kardashian had neglected to disclose that she had been paid $250,000 to write a piece regarding the EthereumMax-offered EMAX coins. The regulator said that the post included a link to the EthereumMax website, which provides visitors with instructions on how to purchase the tokens, along with the hashtag "#ad."

According to the SEC, she broke federal securities laws by failing to disclose the payment. She consented to pay a total of $260,000, which consists of the $1 million fine, interest, and the cash she got.

“Congress passed a law many decades ago called the Securities Act, and it was to protect the public,” Gensler told CNBC’s “Squawk Box” on Monday morning.  “Part of that law said that if you tout a stock you have to disclose if you’re getting paid.”